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The Russian car market is sick, the doctor is not coming: the results of car sales in April are discouraging

  • May 6, 2023
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This is the first month of last year in which the Russian car market showed us growth compared to the same month last year. However, statistics is a

The Russian car market is sick, the doctor is not coming: the results of car sales in April are discouraging
This is the first month of last year in which the Russian car market showed us growth compared to the same month last year. However, statistics is a tricky science. She’s like a drawbar – where you turn, there it went. The AvtoVzglyad portal tried to analyze what is really going on in the automotive industry based on the available data.

The reservation about the availability of data was not made by chance. Unfortunately, the Automobile Manufacturers Committee of the Association of European Businesses (AEB) has not been the source of information it used to be for years. The main problem is that the database is objectively incomplete.

Cars imported as part of parallel imports are not taken into account. Previously it was easy to turn a blind eye to this because of the meager flow. Now the cars delivered in this way make up more than 10% of the total market and cannot be ignored. In addition, BMW, Mercedes-Benz, Evolute, Chery with all sub-brands only provide data on a quarterly basis. And if the “Germans” with a pure soul can be ignored, since their sales steadily tend to zero, then the “Chinese” can greatly correct the overall picture.

Compared to bottom

Nevertheless, some conclusions can be drawn from the data available to the AEB. New car sales reportedly increased 70.6% in the early month of April compared to the same period last year. Recall that in April 2022 the decrease was 78.5% compared to 2021. But that does not mean at all that passenger car sales volumes are back to the old level.

Two years ago, 151,964 vehicles were sold this month, while only 54,270 units were sold in 2023. That is in reality compared to not the most successful, but more or less quiet year to last, the market fell by 64.3%. Happily bouncing, describing our successes against the background of 2022, which cannot but be called the “bottom”, is in any case not serious.

AVTOVAZ does its best to take advantage of the favorable market conditions, but does not succeed very well. Yes, compared to last year, it fell less than the market as a whole – by 27%. But let’s not pretend: current products are still inferior in class and quality to pre-crisis products, although certain steps are being taken to close this gap. The release of Vesta with airbags and ABS has already resumed and I hope that the flagship of the XRAY family will be returned to us soon, and in an unneutered form.

The rest of the brands that have remained in Russia are doing very well in percentage terms, but not brilliantly in physical terms. I won’t quote and comment on the three and sometimes four digit sales growth of our Chinese friends – they’ve been selected from the mud of the assessment, so the low base effect works. The current market leaders, according to the AEB, who occupy second and third positions – Haval and Geely – would have finished eighth and ninth two years ago, between Toyota and Nissan.

First of all electric cars?

Even the most successful Chinese brands have yet to reach the heights occupied by the Korean brands Kia and Hyundai with monthly sales of 19 and 15 thousand cars. However, this does not mean that such a breakthrough is impossible in principle. It is quite possible and even desirable for at least three reasons.

The first is to finally saturate the scarce Russian car market. The second is to wipe the noses of the fleeing producers, to show them what they’ve lost. The third is to put out precisely this market so that the return of the fugitives becomes at least a failure, and at most – not very successful. And although the “heavenly” automakers see only confirmation that they have chosen their strategy correctly, and without them, Russia is somehow not very successful in coping with the situation.

But overall, our market is still sick. But for the auto industry to recover a little faster than a patient on a ventilator, you need to do this and not wait for everything to sort itself out. You need a qualified doctor. Our ministries and departments behave as if everything in their field is already in chocolate, and nothing is more important than lobbying for electric vehicles.

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The reservation about the availability of data was not made by chance. Unfortunately, the Automobile Manufacturers Committee of the Association of European Businesses (AEB) has not been the source of information it used to be for years. The main problem is that the database is objectively incomplete.

Cars imported as part of parallel imports are not taken into account. Previously it was easy to turn a blind eye to this because of the meager flow. Now the cars delivered in this way make up more than 10% of the total market and cannot be ignored. In addition, BMW, Mercedes-Benz, Evolute, Chery with all sub-brands only provide data on a quarterly basis. And if the “Germans” with a pure soul can be ignored, since their sales steadily tend to zero, then the “Chinese” can greatly correct the overall picture.

Compared to bottom

Nevertheless, some conclusions can be drawn from the data available to the AEB. New car sales reportedly increased 70.6% in the early month of April compared to the same period last year. Recall that in April 2022 the decrease was 78.5% compared to 2021. But that does not mean at all that passenger car sales volumes are back to the old level.

Two years ago, 151,964 vehicles were sold this month, while only 54,270 units were sold in 2023. That is in reality compared to not the most successful, but more or less quiet year to last, the market fell by 64.3%. Happily bouncing, describing our successes against the background of 2022, which cannot but be called the “bottom”, is in any case not serious.

AVTOVAZ does its best to take advantage of the favorable market conditions, but does not succeed very well. Yes, compared to last year, it fell less than the market as a whole – by 27%. But let’s not pretend: current products are still inferior in class and quality to pre-crisis products, although certain steps are being taken to close this gap. The release of Vesta with airbags and ABS has already resumed and I hope that the flagship of the XRAY family will be returned to us soon, and in an unneutered form.

The rest of the brands that have remained in Russia are doing very well in percentage terms, but not brilliantly in physical terms. I won’t quote and comment on the three and sometimes four digit sales growth of our Chinese friends – they’ve been selected from the mud of the assessment, so the low base effect works. The current market leaders, according to the AEB, who occupy second and third positions – Haval and Geely – would have finished eighth and ninth two years ago, between Toyota and Nissan.

First of all electric cars?

Even the most successful Chinese brands have yet to reach the heights occupied by the Korean brands Kia and Hyundai with monthly sales of 19 and 15 thousand cars. However, this does not mean that such a breakthrough is impossible in principle. It is quite possible and even desirable for at least three reasons.

The first is to finally saturate the scarce Russian car market. The second is to wipe the noses of the fleeing producers, to show them what they’ve lost. The third is to put out precisely this market so that the return of the fugitives becomes at least a failure, and at most – not very successful. And while the “heavenly” automakers see only confirmation that they have chosen their strategy correctly, and without them, Russia is somehow not very successful in coping with the situation.

But overall, our market is still sick. But for the auto industry to recover a little faster than a patient on a ventilator, you need to do this and not wait for everything to sort itself out. You need a qualified doctor. Our ministries and departments act as if everything in their field is already in chocolate, and nothing is more important than lobbying for electric vehicles.

Source: Avto Vzglyad

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